Thursday, 1 December 2016

For No Good Reason

Benefit claimants in the North East are three times as likely to have their money cut than those in many other parts of the country.

And the variation suggests so-called sanctions are being imposed in an “inconsistent” way, according to an official watchdog.

The findings, from the National Audit Office (NAO), come after North East MPs warned that officials have been encouraged to strip claimants of benefits for no good reason.

A tough sanctions regime is supposed to ensure unemployed people are looking for work and taking up offers of training, but MPs say claimants have been treated unfairly and left without money because of mistakes by the people who are supposed to help them.

The National Audit Office discovered wide variations in how often private businesses employed by the Government to run the Work Programme, which is meant to help people get jobs, tell the Department of Work and Pensions that sanctions should be imposed.

This is known as “referring” a claimant.
In the North East there are two businesses running the Work Programme.

One of them sent two referrals for every claimant over a five year period, and the other sent 2.5 referrals.

But in parts of the south west of England, the figure is 0.7 referrals, while in parts of London the figure was 0.9 referrals.

It means some North East benefit claimants were more than three times as likely to have sanctions imposed as those in the south west.

The National Audit Office also warned that in some cases, referral rates could be significantly different in the same part of the country when two different businesses were involved in running the Work Programme and apparently took different approaches.

It said:

“While local discretion and individual circumstances will always lead to some variation in sanction use, the Department has a responsibility to ensure that people in similar circumstances are treated consistently and fairly.

“The Department needs to monitor and understand the reasons for variations in sanction use.”

And it said: “Variation is poorly understood and may suggest inconsistent use of conditions and sanctions.”

The National Audit Office report also found that the sanctions regime actually costs more than it saves.

It costs between £30 and £50 million a year to apply sanctions, and around £200 million monitoring the conditions it sets for claimants, a total of at least £230 million.

But the Department for Work and Pensions withheld £132 million from claimants due to sanctions in 2015, and paid them £35 million in hardship payments, a total of £167 million.

A quarter of Jobseeker’s Allowance claimants receive them at some point, which means their benefits are cut or stopped entirely.

The Government imposed 400,000 sanctions in 2015.

Amyas Morse, head of the National Audit Office, said:

“Sanctions on benefits have a high opportunity cost, not only for those who are dependent on those benefits if sanctions are applied, but for the efficient use of public resources.

“We acknowledge the department’s effort to reduce its error rate on sanctions, but we think there is more to do in terms of reducing them further, and in reducing the notable differences in sanctions applications between comparable localities.”

In a Commons debate last year, North East MPs highlighted a series of wrong decisions in the region including veterans injured in Afghanistan or Iraq stripped of benefits after they were told they were fit to work; a Newcastle man stripped of benefits because he was accused of failing to seek work in the days after his father died, and a man in Bishop Auckland constituency who was a collecting a sick daughter from school and was accused of inventing a “fictional child”.